Sunday, March 15, 2009

BRIC calls for more balanced IMF

S Kalyana Ramanathan / Horsham (near London) March 15, 2009

Brazil, Russia, India & China (known collectively as BRIC) today sought a re-balancing of representation on the executive board and the International Monetary and Financial Committee of the International Monetary Fund (IMF). The committee is the policy-making arm of the IMF.

The demand was made at the G20 finance ministers’ meeting being held near London. India was represented by the Deputy Chairman of the Planning Commission, Montek Singh Ahluwalia, RBI Governor Duvvuri Subbarao and the Secretary, Department of Economic Affairs, Ministry of Finance, Ashok Chawla.

The BRIC economies also said that protectionism was becoming an increasingly real threat to the global economy. They also sought commitment from the world leaders that they would walk towards a prompt and successful completion of the Doha round.

A joint communiqué issued by the BRIC economies said: “We consider that the IMF’s resources are clearly inadequate and should be very significantly increased through various channels. Borrowings should be a temporary bridge to a permanent quota increase as the fund is a quota-based institution. Hence, we call for completion of the next general review of quotas by January 2011.”

They also asked for speeding up of the second phase of voice and representation reform in the World Bank group by April 2010. G20 nations broadly agreed on curbing tax havens. The BRIC members, in their communiqué, said: “We consider that all financial activities must be subject to adequate regulation and supervision.”